The Post Smartphone Era
It is time to start looking beyond smartphone hardware. We are observing signs that the smartphone market is mature. Over 2 billion people have a smartphone and the market is moving to “replacement cycle innovation” rather than “adoption cycle innovation”. In adoption cycle innovation, we see a heavier emphasis on features designed to attract consumers for a first time purchase. Now that smartphones are in a replacement cycle for the most developed parts of the world, we will see more feature evolution than a burst of brand new things. In this regard, the smartphone hardware landscape will start to feel similar to the PC hardware landscape. In the post-mature PC market, it’s not a big deal when vendors launch PCs with new features as it used to be. The smartphone hardware landscape will now follow the same dynamics from here on out.
I want to make it clear when I say we are in the post-mobile era, I’m not saying there is some magical device that will replace the smartphone. In this vernacular, the post-mobile era is not like the post-PC era where the smartphone displaced the PC as the primary computer for the masses. There will be no single product that will sell 1.5-2b annually like the smartphone. And whatever is beyond the smartphone is five and maybe even ten years away from mass market adoption. What’s more, connecting the next billion humans and beyond remains a critical initiative, but it is one that will be much more difficult than connecting the previous two billion. In the vein of my post mobile theme, this will be done because of the previous innovations in hardware to bring down the cost of the device and of connectivity itself.
The smartphone and its now two billion and growing user base, has laid the most critical foundation for the future. It is time to move our focus from smartphone hardware, mobile operating systems and perhaps even the apps themselves and begin to focus more on what the hardware, operating systems, and apps are enabling. As I will start to articulate the post-mobile era more over the next year, the light I will shine is on the things being built on top of, around, and from the mobile foundation which has now been laid.
As my friend Benedict Evans of Andreessen Horowitz, is fond of saying, “Google and Apple have both won the mobile wars.” Apple has the most profitable minority of global consumers and Google has the rest of the 80% of the market. While the share of iOS users and Android users is relevant, to a point, what happens on top of these platforms is now the important story.
One example of this is Financial Tech or FinTech as we call it. Putting a computer with an internet connection into the pockets of two billion (and eventually five billion) humans, opens massive new doors to commerce. We are watching markets like China and India as we see into markets where more digital commerce happens on smartphones than on PCs. This reality will come to the US and European markets as well before too long. When the mobile device becomes a central hub of commerce, banking, lending, and a host of other financial services, it has the potential to reach more customers in a way they have never had before. My deepest conviction around mobile commerce is the smartphone in the pockets of five billion people will be responsible for the single greatest act of financial inclusion the world has ever seen.
Artificial intelligence is another buzzword gaining steam. It seems most major players in the tech world from Microsoft, Google, Apple, Amazon, Facebook, as well as major players in China like Baidu, are all working on artificial intelligence of some kind. This is another area that will be built on top of and, in some cases, from the mobile era. We will need powerful computing capabilities both locally and in the cloud to accomplish true AI presences for consumer use. We will need both deep device hardware security with end-to-end encryption to our cloud services. Artificial intelligence will spring up from the mobile center.
Similarly, the most interesting things around virtual reality will come from the mobile ecosystem rather than the PC ecosystem, despite how it looks today. Look more for smartphone chipsets, software platforms, apps, and other innovations around VR to go mainstream as more VR does not require a cable connected to the PC and is built around and off of the mobile ecosystem.
There are a range of other examples from drones, smart cars, smart homes and smart cities, smartwatches and wearable/embeddable technology and more which are yet to be invented or come to market which will serve as examples of consumer technologies blossoming out of and from the mobile ecosystem. The smartphone has laid the foundation in which the future will be built on and ultimately will eventually give birth to that which displaces it as well. As we embrace the post-mobile era, it is time to shift our attention from the smartphone hardware itself to all the new things the smartphone will enable as the most pervasive form of personal computing in the history of our industry.